WVC 9 - 5 - 11
§9-5-11. Definitions; Assignment of rights; right of subrogation
by the Department for third-party liability; notice
requirement for claims and civil actions; notice
requirement for settlement of third-party claim;
penalty for failure to notify the department;
provisions related to trial; attorneys fees; class
actions and multiple plaintiff actions not
authorized; and Secretary's authority to settle.

(a) Definitions.- As used in this section, unless the context
otherwise requires:

(1) "Bureau" means the Bureau for Medical Services.

(2) "Department" means the West Virginia Department of Health
and Human Resources, or its contracted designee.

(3) "Recipient" means a person who applies for and receives
assistance under the Medicaid Program.

(4) "Secretary" means the Secretary of the Department of
Health and Human Resources.

(5) "Third-party" means an individual or entity that is
alleged to be liable to pay all or part of the costs of a
recipient's medical treatment and medical-related services for
personal injury, disease, illness or disability, as well as any
entity including, but not limited to, a business organization,
health service organization, insurer, or public or private agency
acting by or on behalf of the allegedly liable third-party.

(b) Assignment of rights.-

(1)Submission of an application to the department for medical
assistance is, as a matter of law, an assignment of the right of
the applicant or his or her legal representative to recover from
third parties past medical expenses paid for by the Medicaid
program.

(2) At the time an application for medical assistance is made,
the department shall include a statement along with the application
that explains that the applicant has assigned all of his or her
rights as provided in this section and the legal implications of
making this assignment.

(3) This assignment of rights does not extend to Medicare
benefits.

(4) This section does not prevent the recipient or his or her
legal representative from maintaining an action for injuries or
damages sustained by the recipient against any third-party and from
including, as part of the compensatory damages sought to be
recovered, the amounts of his or her past medical expenses.

(5) The department shall be legally subrogated to the rights
of the recipient against the third party.

(6) The department shall have a priority right to be paid
first out of any payments made to the recipient for past medical
expenses before the recipient can recover any of his or her own
costs for medical care.

(7) A recipient is considered to have authorized all third-parties to release to the department information needed by
the department to secure or enforce its rights as assignee under
this chapter.

(c) Notice requirement for claims and civil actions.-

(1) A recipient's legal representative shall provide notice to
the department within 60 days of asserting a claim against a third
party. If the claim is asserted in a formal civil action, the
recipient's legal representative shall notify the department within
60 days of service of the complaint and summons upon the third
party by causing a copy of the summons and a copy of the complaint
to be served on the department as though it were named a party
defendant.

(2) If the recipient has no legal representative and the third
party knows or reasonably should know that a recipient has no
representation then the third party shall provide notice to the
department within sixty days of receipt of a claim or within thirty
days of receipt of information or documentation reflecting the
recipient is receiving Medicaid benefits, whichever is later in
time.

(3) In any civil action implicated by this section, the
department may file a notice of appearance and shall thereafter
have the right to file and receive pleadings, intervene and take
other action permitted by law.

(4) The department shall provide the recipient and the third
party, if the recipient is without legal representation, notice of the amount of the purported subrogation lien within thirty days of
receipt of notice of the claim. The department shall provide
related supplements in a timely manner, but no later than fifteen
days after receipt of a request for same.

(d) Notice of settlement requirement.-

(1) A recipient or his or her representative shall notify the
department of a settlement with a third-party and retain in escrow
an amount equal to the amount of the subrogation lien asserted by
the department. The notification shall include the amount of the
settlement being allocated for past medical expenses paid for by
the Medicaid program. Within 30 days of the receipt of any such
notice, the department shall notify the recipient of its consent or
rejection of the proposed allocation. If the department consents,
the recipient or his or her legal representation shall issue
payment out of the settlement proceeds in a manner directed by the
secretary or his or her designee within 30 days of consent to the
proposed allocation.

(2) If the total amount of the settlement is less than the
department's subrogation lien, then the settling parties shall
obtain the department's consent to the settlement before finalizing
the settlement. The department shall advise the parties within 30
days and provide a detailed itemization of all past medical
expenses paid by the department on behalf of the recipient for
which the department seeks reimbursement out of the settlement
proceeds.

(3) If the department rejects the proposed allocation, the
department shall seek a judicial determination within 30 days and
provide a detailed itemization of all past medical expenses paid by
the department on behalf of the recipient for which the department
seeks reimbursement out of the settlement proceeds.

(A) If judicial determination becomes necessary, the trial
court is required to hold an evidentiary hearing. The recipient
and the department shall be provided ample notice of the same and
be given just opportunity to present the necessary evidence,
including fact witness and expert witness testimony, to establish
the amount to which the department is entitled to be reimbursed
pursuant to this section.

(B) The department shall have the burden of proving by a
preponderance of the evidence that the allocation agreed to by the
parties was improper. For purposes of appeal, the trial court's
decision should be set forth in a detailed order containing the
requisite findings of fact and conclusions of law to support its
rulings.

(4) Any settlement by a recipient with one or more
third-parties which would otherwise fully resolve the recipient's
claim for an amount collectively not to exceed $20,000 shall be
exempt from the provisions of this section.

(5) Nothing herein prevents a recipient from seeking judicial
intervention to resolve any dispute as to allocation prior to
effectuating a settlement with a third party.

(e) Department failure to respond to notice of settlement.- If
the department fails to appropriately respond to a notification of
settlement, the amount to which the department is entitled to be
paid from the settlement shall be limited to the amount of the
settlement the recipient has allocated toward past medical
expenses.

(f) Penalty for failure to notify the department.- A legal
representative acting on behalf of a recipient or third party that
fails to comply with the provisions of this section is liable to
the department for all reimbursement amounts the department would
otherwise have been entitled to collect pursuant to this section
but for the failure to comply. Under no circumstances may a pro se
recipient be penalized for failing to comply with the provisions of
this section.

(g) Miscellaneous provisions relating to trial.-

(1) Where an action implicated by this section is tried by a
jury, the jury may not be informed at any time as to the
subrogation lien of the department.

(2) Where an action implicated by this section is tried by
judge or jury, the trial judge shall, or in the instance of a jury
trial, require that the jury, identify precisely the amount of the
verdict awarded that represents past medical expenses.

(3) Upon the entry of judgment on the verdict, the court shall
direct that upon satisfaction of the judgment any damages awarded
for past medical expenses be withheld and paid directly to the department, not to exceed the amount of past medical expenses paid
by the department on behalf of the recipient.

(h) Attorneys' fees.- Irrespective of whether an action or
claim is terminated by judgment or settlement without trial, from
the amount required to be paid to the department there shall be
deducted the reasonable costs and attorneys' fees attributable to
the amount in accordance with and in proportion to the fee
arrangement made between the recipient and his or her attorney of
record so that the department shall bear the pro-rata share of the
reasonable costs and attorneys' fees: Provided, That if there is
no recovery, the department shall under no circumstances be liable
for any costs or attorneys' fees expended in the matter.

(i) Class actions and multiple plaintiff actions not
authorized.- Nothing in this article shall authorize the
department to institute a class action or multiple plaintiff action
against any manufacturer, distributor or vendor of any product to
recover medical care expenditures paid for by the Medicaid program.

(j) Secretary's authority. - The secretary or his or her
designee may compromise, settle and execute a release of any claim
relating to the department's right of subrogation, in whole or in
part.
Note: WV Code updated with legislation passed through the 2015 Regular Session
The WV Code Online is an unofficial copy of the annotated WV Code, provided as a convenience. It has NOT been edited for publication, and is not in any way official or authoritative.